Thrive Capital Makes $1 Billion Investment in OpenAI, with Potential for Another $1 Billion Next Year | Reuters
Thrive Capital, a leading investment firm, is set to invest over $1 billion in OpenAI's current $6.5 billion fundraising round, with a unique opportunity to invest an additional $1 billion next year if the AI company meets revenue targets. Sources reveal that OpenAI is anticipating a significant revenue increase to $11.6 billion in the coming year, up from an estimated $3.7 billion in 2024.
The current funding round, structured as convertible debt, is expected to finalize by the end of next week and could value OpenAI at a remarkable $150 billion, solidifying its position as one of the most valuable private companies globally. However, this valuation is contingent on a complex restructuring plan that involves removing control from its non-profit board and eliminating investment return caps for investors.
Thrive Capital, known for leading previous funding rounds for OpenAI, is offering $1.2 billion from its fund along with a special purpose vehicle for smaller investors. Notably, other investors in this round, including tech giants like Microsoft, Apple, Nvidia, and Khosla Ventures, do not have the option for future investment at the current price.
OpenAI's revenue projections far surpass earlier estimates, with its flagship product, ChatGPT, expected to generate $2.7 billion in revenue this year. The company's revenue sources primarily include sales of services to corporations and subscriptions to its chatbot, which boasts around 10 million paying users.
The potential for Thrive Capital to increase its stake in OpenAI at a discounted price next year highlights the rapid growth and valuation of the AI firm. While specific details about Thrive's additional investment option remain undisclosed, the financials and terms were initially reported by the New York Times.
In conclusion, this strategic investment by Thrive Capital in OpenAI signifies a vote of confidence in the AI company's future growth potential. With the tech industry continuously evolving and AI playing a crucial role in various sectors, this partnership could pave the way for groundbreaking advancements and lucrative opportunities in the financial market. Investors and individuals alike should closely monitor developments in the AI space, as it could have a significant impact on their financial portfolios and overall investment strategies.
